The supply of product X is inelastic (but not perfectly inelastic) if the price of X rises by

A) 4 percent and quantity supplied rises by 6 percent.
B) 7 percent and quantity supplied rises by 7 percent.
C) 12 percent and quantity supplied remains the same.
D) 5 percent and quantity supplied rises by 2 percent.

Question

Aaron Duncan · Accepted Answer

Final Answer : D, Explanation :  The supply of a product is considered inelastic when the percentage change in quantity supplied is less than the percentage change in price, which is the case in option D (5% price increase leads to only a 2% increase in quantity supplied).

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